Quotulatiousness

August 24, 2015

Comparative Advantage

Filed under: Australia, Economics, History — Tags: , , , , — Nicholas @ 02:00

Published on 25 Feb 2015

What is comparative advantage? And why is it important to trade? This video guides us through a specific example surrounding Tasmania — an island off the coast of Australia that experienced the miracle of growth in reverse. Through this example we show what can happen when a civilization is deprived of trade, and show why trade is essential to economic growth.

In an economy with a greater number of participants trading goods and services, there are more ways to find a comparative advantage and earn more by creating the most value for others. Let’s dive right in with an example from our new friends, Bob and Ann.

Related posts:

  1. Price Controls and Communism
  2. I hope he’s right
  3. CETA as a lever to (finally) loosen rules on inter-provincial trade
  4. Six political talking points on international trade that are myths
  5. Price Ceilings: Deadweight Loss

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